e.l.f. Beauty, Inc.

Thank you for joining us today to discuss Elf Beauty's first quarter fiscal 27 results. I'm Casey Katten, Vice President of Corporate Development and Investor Relations. With me today are Tarang Amin, Chairman and Chief Executive Officer, and Mandy Fields, Senior Vice President and Chief Financial Officer. We encourage you to tune into our webcast presentation for the best viewing experience, which you can access on our website at investor.elfbeauty.com. Since many of our remarks today contain forward-looking statements, please refer to our earnings release and reports filed with the SEC, where you will find factors that could cause actual results to differ materially from these forward-looking statements. In addition, the company's presentation today includes information presented on a non-GAAP basis. Our earnings release contains reconciliations of the differences between the non-GAAP presentation and the most directly comparable GAAP measure. With that, let me turn the webcast over to Tarang.

Thank you, Casey, and good afternoon, everyone. I'm proud of the L.F. Beauty team for achieving another quarter of industry-leading results. In Q1, we grew net sales 36% and delivered our 30th consecutive quarter of net sales growth. That's over seven continuous years of net sales growth. We're one of only six public consumer companies Out of 516 that has grown for 30 straight quarters and average at least 20% net sales growth per quarter. This consistent category leading growth is a testament to the strength of our team, strategy, and portfolio of brands. With the momentum we're seeing, we're raising our fiscal 27 outlook to 18-20% net sales growth as compared to 12-14% previously. We have strength across our diversified portfolio of brands. For context, out of approximately 1,800 cosmetics and skincare brands tracked by Nielsen, only 14 have surpassed $200 million in retail sales. We have four brands to surpass this threshold, each built on the same winning combination, value proposition, powerhouse innovation, and disruptive marketing engine. e.l.f. Cosmetics holds the number one rank in unit share and number two in dollar share. e.l.f. Skin has risen from the number 25 mass skincare brand a few years ago to the number 11 brand. Notorium is the fastest growing skincare brand among the top 50. And Rode, the breakthrough beauty brand founded by Hailey Bieber, continues its outstanding growth. We believe RODE could be the fastest beauty brand to achieve a billion dollars in net sales. As e.l.f. Beauty scales towards $2 billion in net sales, we believe the continued diversification of our business across brands, categories, channels, and supply chain positions us well for the next chapter of growth. Over the past three years, we've grown non-e.l.f. sales from less than 1% Oshiya Savur, By the end of this fiscal year, we expect to be around 60%. We now have a more robust supply chain to meet the global demand that we see for our brands, while maintaining our unique combination of quality, cost, and speed. Looking at our most recent results, let me provide an update on each of our brands. Starting with Elf. As we talked last quarter, we're taking a series of actions to strengthen the e.l.f. brand across five key areas. Value proposition, powerhouse innovation, disruptive marketing, international expansion, and category adjacencies. First, value proposition. For 22 years, we've democratized access to the best of beauty. The average price point for e.l.f. Cosmetics is about $7.00, As compared to over $10 for legacy mask brands and over $30 for prestige brands. At a time when consumers remain concerned about the economy, our value proposition has never been more important. To that end, last quarter we spoke about the pricing actions we're taking to drive unit momentum. We began a price discovery test in May, expanding what initially was a temporary price reduction on a single product to the majority of ELF brand SKUs. We learned through this testing the vast majority of our SKUs are priced appropriately, reinforcing our value proposition. We did identify about 10% of our SKUs where we believe we can drive units by maintaining lower prices. The remaining SKUs will return to their pre-test prices over the next couple weeks. These pricing actions strengthen our confidence in delivering a superior value proposition. Second, powerhouse innovation. Our community-led innovation model is one of our most durable competitive advantages. We listen closely to our community and quickly translate their requests into premium quality products at extraordinary prices. Our fall 2026 innovation hit shelves in July and we're pleased to be delivering ahead of our expectations. Across the mass cosmetics category so far this season, e.l.f. holds four of the top ten new launches in dollars and five of the top ten in units. Our main stain lip marker, Power Grip Rose Setting Spray, Cream Blush and Bronzer Duo Brush, Sheer Fort Blush Tint and Thirst Burst Lip Treatment All are resonating with consumers.

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